Reference no: EM133169181

Question - The income statement and additional data of Kratz Photography Ltd.? follow:

Kratz Photography Ltd. Income Statement For the Year Ended December 31, 2020
Revenues:
	Consulting revenue		$155,000
Expenses:
	Salaries expense	$88,000
	Amortization expense	14,500
	Rent expense	6,000
	Office supplies expense	2,500
	Insurance expense	2,200
	Interest expense	1,000
	Income tax expense	9,500	123,700
Net income			$31,300

a. Collections from clients are $4,700 more than revenues.

b. Increase in cash balance, $9,500.

c. Payments to employees are $5,000 less than salaries expense.

d. Interest expense and income tax expense equal their cash amounts.

e. Acquisition of property, plant, and equipment is $64,000. Of this amount, $54,000 is paid in cash, $10,000 by signing a long-term note payable.

f. Cash received from sale of land, $9,000.

g. Cash received from issuance of common shares, $23,000.

h. Payment of long-term note payable, $14,000.

i. Payment of cash dividends, $6,500.

j. Payments for rent and insurance are equal to expense.

k. Payment for office supplies is $3,500 more than expense.

l. Opening cash balance, $14,000.

Required -

1. Prepare Kratz Photography Ltd.'s cash flow statement by the direct method for operating activities and a note to the financial statements providing a summary of non-cash investing and financing activities.

2. Assume Kratz Photography Ltd. has adopted IFRS. What would be the difference in the cash flow statement using this framework?